$400 million investment in tertiary education system

Budget 2002 contains a $400 million package to promote relevance, excellence and accessibility in the tertiary education system, says Associate Education (Tertiary Education) Minister Steve Maharey.

“Tertiary education has a key contribution to make to the economic and social development of New Zealand as the Prime Minister’s growth and innovation framework explicitly recognised.

“A new Integrated Funding Framework, to be phased in from 2003, shifts the focus for funding away from simply attracting students at the lowest possible cost to the government toward rewarding excellence and the contribution tertiary providers make to New Zealand’s economic and social development.

“The new framework will strengthen the capability of the tertiary education sector as a whole and encourage stronger relationships between providers and the sectors and communities they serve,” says Steve Maharey.

The framework contains three broad elements [all figures detail new investment over the next four years unless specified]:

- funding for teaching and learning ($277 million announced separately in the Investing in knowledge and skills for New Zealanders statement);

- funding for research ($94.272 million); and

- a strategic development component ($21.277 million).

Funding for teaching and learning

Budget 2002 allocates $277 million to replace the current EFTS system with a Student Component containing a performance-related element. This will balance a commitment to wide participation with enrolment management in some areas. The Student Component will ensure limits on student fees and will be set on the basis of a rolling triennium from 2004 onwards to better enable long-term planning by tertiary education providers.

The Student Component will be complemented by funding arrangements for industry training, Modern Apprenticeships, Training Opportunities and Youth Training, Gateway, adult literacy programmes, adult and community education, ESOL and other foundation learning, and learning and assessment centres.

Funding for research

An extra $94.272 million in operating and capital funding has been allocated. This is comprised of:

„« performance-based funding for research to be phased in from 2003. By 2007, it will fully replace the existing “research top-up’ (which is included as part of the present EFTS system). An additional $36.272 million will be invested in the Performance Based Research Fund on a rising scale over the next four years, reaching $20 million a year in 2006; and

„« a further $38 million in operating funding, and an initial $20 million one-off allocation for capital expenditure, to develop more Centres of Research Excellence.

Strategic development component

New funding totals $21.277 million and consists of:

„« a $10 million contestable fund in 2003 for initiatives to meet the goals of the Tertiary Education Strategy and to build on the work undertaken through the 2002 $35 million Strategic Change Fund and through the Collaborating for Efficiency project;

„« $6.277 million in operating funding to support e-learning capability throughout the tertiary sector (further capital funding will be announced shortly);

„« a polytechnic regional economic development fund of $5 million from 2003 to 2005 to enable polytechnics to better respond to regional training needs and to identify local economic development opportunities;

„« contingency funding to support Partnerships for Excellence between tertiary institutions, the private sector and the government;

„« the existing annual base grant of up to $250,000 provided to all public tertiary education institutions; and

„« the existing funding grants to provide support services for Maori and Pacific students, and students with disabilities.

Other initiatives are:

- $6.1 million to improve the quality and relevance of education offered by Maori and Pacific PTEs.

- A further $1.575 million to support better governance and decision making within the tertiary education sector.

“The provisions in Budget 2002 will enable the new Tertiary Education Commission, which comes into being on 1 July, to prepare the sector for a quantum leap forward in teaching and research performance so that it can meet the needs of learners, industry and the community more effectively,” Steve Maharey said.

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